- The Washington Times - Wednesday, September 17, 2003

From combined dispatches

African farm interests and governments welcomed this week the strong stance taken by the developing world in its battle with the wealthy industrialized nations over export subsidies on farm products, and the collapse of the World Trade Organization talks in Cancun, Mexico, on Sunday over European and U.S. agriculture subsidies.

“Many of us saw it coming,” Agence France-Presse quoted Boma Anga, a Nigerian businessman working on a state-sponsored import-substitution program, as saying in Lagos.

“We knew that unless Europe and America were willing to make concessions, there would be deadlock. We feel that this deadlock is important to us,” he said.

“It’s important that the developing countries send a strong message. In a sense, we feel elated now, because that message is getting through. If we must trade on a global field, let it be a level playing field,” he said.

Nigeria is looking for ways to use its cassava production to replace many foreign imports, using the tropical crop to produce ethyl alcohol, monosodium glutamate and animal feed, Mr. Anga said. But West African efforts at import substitution have been stymied by the dumping on its market of cheap, subsidized agribusiness products from developed nations, he said.

Last week, Nigeria’s finance minister, former World Bank Vice President Ngozi Okonjo-Iweala, told AFP that the developed world’s hypocritical stance on export subsidies was hampering Nigerian economic reform. She said the industrialized world, represented by the Organization for Economic Cooperation and Development, gives its farmers $300 billion — “the equivalent of Africa’s [gross domestic product]” — in handouts annually.

“I know that we have to look at our own infrastructure and internal processes,” she conceded, as she outlined plans to develop Nigeria’s internal and export markets for farm products.

But in Cancun, the tables were turned as a new and expanding alliance of developing countries left the doomed WTO conference empty-handed but far from despondent, having flexed newfound muscles.

Led by heavyweights Brazil, India and China, the “Group of 20-plus” voiced satisfaction with its role, and results, in emerging as a new force in pressing the demands of poor countries, with agriculture reform being the driving factor.

Spanning Latin America, Africa and Asia, the alliance found itself at loggerheads with the WTO’s two economic powerhouses, the United States and the 15-member European Union.

Brussels bristled over the group’s demands for a complete elimination of subsidies designed to help farm exporters, while Washington complained that the group had failed to make known the concessions it was prepared to make.

South Africa, a member of the “G-20 plus,” expressed disappointment at the lack of a deal in Cancun, but said the conference was not a failure in terms of “advancing the cause for agriculture.”

“We had made what we felt was important progress, we were in the position to make further progress,” the country’s minister of trade and industry, Alexander Erwin, told reporters.

Cox News Service reported that as the U.S. and European delegations jetted home from the Mexican resort in defeat, African cocoa producers, Latin American coffee farmers, and other small agricultural producers gathered a few miles away to show off coffee, chocolate, tequila, Nepalese jewelry and Panamanian and Peruvian woven cloth whose profits are more diverted to producers, rather than middlemen.

International aid and development groups, like Oxfam, worry that the globalization of trade — the opening of markets to the world’s biggest producers — is creating a “race to the bottom” that is driving down prices for those in the lowest rungs of the international trade ladder.

To combat this, a global network called Fair Trade Labeling Organizations International has established a way to certify that products have been produced without labor abuses and with prices that are higher because of their quality or because they are organic.

The push is on to get more products with fair-trade labels in retail stores. The U.S. chain Dunkin’ Donuts, which includes 3,500 franchises, announced this year that its new espresso drinks would use 100 percent fair-trade coffee beans, a decision that Oxfam praised.

“Fair trade makes a big difference to us. With fair-trade sales, we’ve been able to get villages potable water, sanitation facilities and more money to invest in other economic activities,” said Appiah-Kubi Abraham, who was in Cancun to promote the Kuapa Kokoo cocoa bean cooperative, which unites 40,000 farmers in Ghana.

The farmers in Ghana earn only about $400 a year from their cocoa. But because their cocoa sells at higher-than-normal world prices, they earn a surplus. They have an agreement to set aside some of that surplus to invest in infrastructure, such as a public well, or projects to develop other sources of income and reduce their dependency on cocoa.

The Kuapa Kokoo cooperative also owns 33 percent of the Day Chocolate Co., which sells Divine and Dubble chocolates, products that bear fair-trade labels and are distributed in the United States and Britain. Cocoa farming is under scrutiny, with reports of child labor and slavery in West Africa, where much of the world’s cocoa is produced.

The Washington-based Fair Trade Federation, which helped host the Cancun exhibit, estimates that commerce that met fair-trade standards surpassed $400 million last year, translating into an extra $30 million for producers in about 40 countries. While still small, it is a 44 percent jump from the year before.

Because of a flood of coffee on the global market and the dismantling of international agreements that controlled its prices and supply, coffee farmers have been devastated by plunging rates for their beans, despite rising retail prices. Coffee growers in Latin America, Asia and Africa have seen prices drop as much as 70 percent in five years, according to Oxfam.

“World commerce is basically in favor of the big multinationals,” said one grower on the sidelines of the WTO meeting. “There is an injustice in the price of coffee. We see that every day coffee is sold for more and more, while what we producers earn is nothing.”

Sign up for Daily Newsletters

Manage Newsletters

Copyright © 2020 The Washington Times, LLC. Click here for reprint permission.

Please read our comment policy before commenting.


Click to Read More and View Comments

Click to Hide